What "P&C" means
Property & Casualty is the American name for insurance that pays when things are damaged or lost (property) or when you are legally responsible for harm to someone else (casualty, or liability). In Europe the same business is usually called non-life or general insurance. In Danish it is skadesforsikring, as opposed to livsforsikring (life and pension).
Property — "first party"
Pays you for your own loss: your house after a burst pipe, your car after a collision, your stock after a fire, lost income while your shop is closed.
Casualty / liability — "third party"
Pays others on your behalf when you are legally liable: the cyclist you hit, the customer injured in your shop, the client harmed by your advice.
Most real policies bundle both. A Danish car policy combines mandatory liability cover with optional own-damage cover. A Danish contents policy (indboforsikring) usually includes personal liability and legal-expense cover as well.
The principles that make insurance work
Risk pooling and the law of large numbers
Nobody knows whose house will flood this year, but an insurer with 300,000 home policies can predict fairly accurately how many will. Each customer pays a small, certain amount (the premium) in place of a small chance of a large, uncertain loss. The more similar, independent risks in the pool, the more stable the result. That is why catastrophes, which hit many policies at once (a winter storm across Jutland, say), are the hardest risks for an insurer and the main reason to buy reinsurance.
Insurable interest
You can only insure something whose loss would cost you money: your own house, your company's machinery, your legal liability. Without insurable interest a policy is just a bet.
Indemnity
Non-life insurance aims to put you back where you were before the loss: no better, no worse. That leads to everyday rules you will see throughout the course:
- Deductible (selvrisiko): you carry the first part of each loss yourself.
- Depreciation (afskrivning): old items are often paid at a reduced value, depending on the policy terms. "New for old" is a feature the terms grant, not the default.
- Underinsurance (underforsikring): if the sum insured is too low, the payment can be reduced proportionally.
- Double insurance (dobbeltforsikring): two policies covering the same loss share it; you can't collect twice.
Disclosure and good faith
The insurer prices the risk on what you tell it. Under the Danish Insurance Contracts Act, giving incorrect or incomplete information can reduce or remove cover, depending on whether it was fraudulent, negligent or innocent and on whether the insurer would have accepted the risk anyway. On the other side, the insurer must give clear pre-contract information and act fairly.
Subrogation
After paying you, the insurer steps into your shoes and can recover from whoever caused the loss. In Danish this is regres. You will meet it again in the claims module and in ClaimCenter's recoveries.
Who's who in a policy
| Role | Danish | What they do |
|---|---|---|
| Policyholder | forsikringstager | Signs the contract and pays the premium. |
| Insured person | sikrede | The person whose loss or liability is covered (often the policyholder plus household members). |
| Insurer | forsikringsselskab | Carries the risk, issues the policy, pays claims. Can be a public company or a mutual (gensidigt selskab) owned by its customers. |
| Broker | forsikringsmægler | Independent adviser who acts for the customer. Common in commercial insurance. |
| Agent / tied agent | forsikringsagent | Sells on behalf of one or more insurers. Banks often act as distributors (bancassurance). |
| Loss adjuster | taksator | Inspects damage, estimates repair cost and may agree the settlement. |
| Reinsurer | genforsikringsselskab | Insures the insurer against large or accumulated losses. |
Personal-lines insurance in Denmark is mostly sold directly by the insurer (web, phone, app), often bundled with discounts for holding several policies. The market is concentrated among a handful of large groups (for example Tryg, Topdanmark, Alm. Brand, Gjensidige, If) plus member-owned companies such as LB Forsikring and GF Forsikring. Commercial and industrial risks rely much more on brokers.
The Danish rulebook
You don't need to be a lawyer, but anyone working on Danish insurance systems constantly meets these names in requirements, documents and letters.
| Name | What it is | Why it matters day to day |
|---|---|---|
| Forsikringsaftaleloven (FAL) | Insurance Contracts Act | The contract between insurer and customer: disclosure, premium reminders, cancellation, claims notice, limitation periods. |
| Lov om finansiel virksomhed | Financial Business Act | Licensing, governance, good business conduct and solvency rules for insurers. |
| Finanstilsynet | Danish Financial Supervisory Authority | Licenses and supervises insurers; implements Solvency II and EU conduct rules. |
| Forsikring & Pension (F&P) | Industry association | Shared industry standards, statistics, data registers and joint schemes. |
| Ankenævnet for Forsikring | Insurance complaints board | Consumers can complain here, for a small fee, after the insurer's own complaints handling. |
| Garantifonden | Guarantee fund for non-life insurers | Protects many consumer claims if a non-life insurer goes bankrupt. |
| Solvency II & IDD | EU directives | Capital, risk management and reporting (Solvency II); distribution and advice rules (Insurance Distribution Directive). |
Compulsory insurance in Denmark
- Motor third-party liability (ansvarsforsikring for motorkøretøjer) is required by the Road Traffic Act for every registered vehicle.
- Workers' injury insurance (arbejdsskadeforsikring) is required for employers under the Workers' Injury Act.
- Dog liability insurance (hundeansvarsforsikring) is required for dog owners.
Other covers, such as building insurance, are not legally required but are effectively mandatory in practice: a mortgage lender (realkreditinstitut) will insist on fire cover for the property it lends against.
How money moves through an insurer
An insurer collects premium before it knows what claims will cost, and it may pay those claims years later. That gap drives most of its finance and IT design.
Three ideas from this picture come back in every later module:
- Earned vs unearned premium. A 12-month premium paid on 1 January is only fully "earned" on 31 December. Billing and finance track how much is earned each day.
- Reserves. Money set aside for claims that have happened but are not yet paid, including claims not yet reported.
- Combined ratio. (Claims + expenses) ÷ earned premium. Below 100% means the insurer makes money on underwriting alone.
Key takeaways
- P&C = non-life = skadesforsikring: cover for your own property plus your liability to others.
- Pooling many similar, independent risks makes losses predictable; catastrophes break that, which is where reinsurance comes in.
- Indemnity explains deductibles, depreciation, underinsurance and subrogation (regres).
- In Denmark: FAL governs the contract, Finanstilsynet supervises, Ankenævnet handles complaints, Garantifonden protects customers if an insurer fails.
- Motor liability, workers' injury and dog liability insurance are compulsory.